Gianforte takes veto scalpel to infrastructure bill

Gov. Greg Gianforte flexed his veto powers this week to cut into a $1.2 billion infrastructure bill that drew allegations of pork-barrel spending as it emerged from this year’s Montana Legislature.

The governor’s action strikes authorization for 11 projects from the 46-page bill in what he said was an effort to effectively steward public dollars. Totalling about $23 million, the line-item vetos leave a relatively small mark on one of the session’s largest spending measures but come as his office and lawmakers wrangle over announced and potential vetoes on several key pieces of budget legislation.

Bills, including those that authorize state spending, are passed by the Legislature and then signed into law by the governor. When the governor vetoes a law instead of signing it, or strikes individual budget lines, lawmakers can override his veto with two-thirds of the votes in the House and Senate. With the Legislature adjourned for the year as of May 2, override votes are conducted by the secretary of state via a mailed poll.

Gianforte previously announced a veto on Senate Bill 442, a marijuana revenue allocation measure, and several other bills that passed the Legislature with broad bipartisan support. He has yet to sign other measures, including House Bill 648, a Democrat-sponsored bill that would put additional funding toward childcare, and the state’s main budget bill, House Bill 2, which includes much-debated line items boosting Medicaid reimbursement rates for some health providers.

The infrastructure bill, House Bill 5, is nominally the main spending bill that allocates dollars in accordance with a long-range building plan for state properties. In a memo May 23 explaining his action, Gianforte wrote that the version of the bill passed by the Legislature made many “prudent” investments in state facilities, particularly the Montana State Prison in Deer Lodge. However, he said, the bill “also includes projects that are unnecessary, expend taxpayer resources simply by failing to leverage federal funding, or do not involve state-owned facilities.”

Among other items, Gianforte vetoed an $8 million allocation for the Yellowstone Conservation Area, a Billings-area reservoir and park project. He also nixed a $6 million allocation for the Southwest Montana Veterans Home in Butte, a $2 million local park grant program, $2 million for two Chippewa Cree buildings, $1 million for water and sewer upgrades in Columbus, and $250,000 for a public plaza on Missoula’s riverfront walking trail.

Those cuts were all explicitly recommended by Senate Majority Leader Steve Fitzpatrick, R-Great Falls, who had made a largely futile effort to strip some of that spending from the bill as it was debated on the Senate floor last month.

“We take pride here in this Capitol that we are not Washington, D.C., that we follow the right process and we don’t lard up bills with unnecessary pork,” Fitzpatrick said then. His colleagues voted to remove $9.6 million for a mining museum in Butte but then balked at further efforts to slim down the bill.

In a letter May 18 to the governor, Fitzpatrick wrote that some of the remaining projects should be vetoed because they were added to the bill late in the session by members of the Senate Finance and Claims Committee, rather than passing through the established process state government uses to vet and rank most proposals for funding. Others, he argued, had been inappropriately shoehorned into a spending bill intended for funding construction on state property.

“Both the legislative and executive branches have developed systems to ensure projects and spending requests are based upon need and not the desires of individual legislators for more spending,” Fitzpatrick wrote. “Unfortunately, this session, I believe the Legislature added several projects and items of spending which are unnecessary and should be removed.”

Fitzpatrick did counsel the governor against vetoing one line item added by the Senate finance committee, $2 million for renovating a Miles City train depot that had been added at the behest of Miles City Republican Sen. Kenneth Boger. “[I]t is my understanding the Montana Department of Fish, Wildlife, and Parks has been actively engaged in this project prior to the session,” Fitzpatrick wrote. “Thus, I believe it is appropriate to keep this project in House Bill 5.”

The Miles City depot funding survived the governor’s veto pen this week. Gianforte also refrained from vetoing two line items Fitzpatrick had recommended striking, $5 million for grants to homeless shelters and $3.7 million for remediating lead in school drinking water.

In all, the governor’s 11 line-item vetoes total about $23 million, roughly 2% of the overall bill.

“Regardless of the merits of these line-item appropriations, there are more transparent, fiscally responsible methods to appropriate taxpayer dollars than racing to add unrelated projects into the state government infrastructure appropriations bill as the legislative session ends,” Gianforte wrote.

Three of the vetoed projects, the Chippewa Cree buildings and the Missoula trail plaza, were added to the bill by the House Appropriations Committee March 15, a month-and-a-half before the session ended.

Senate Democrats criticized the line-item vetos Thursday, focusing particularly on the veterans home in Butte.

“The Governor, with great haste, signed legislation that gave himself and his rich friends nearly a billion in tax breaks this session, but turns around just days before Memorial Day and vetoes $6 million for our veterans to build the last cottage and complete the Southwest Montana Veterans Home in Butte,” Butte Democratic Sen. Ryan Lynch, who had advocated for that funding, wrote in an emailed statement.

Fitzpatrick and the governor wrote that the $6 million for the veterans’ home had been money that was expected to come from the federal government.

The majority leader’s letter also suggests line-item vetos for the state’s primary budget bill, House Bill 2, which was passed by the Legislature before it adjourned for the year but hasn’t been formally transmitted to the governor pending a signature from Senate President Jason Ellsworth, R-Hamilton.

Most notably, Fitzpatrick suggests vetoing $15 million the Senate added to the budget bill in an effort to boost Medicaid provider rates beyond increases proposed by the governor. A state-commissioned study published last year found that the state’s current rates were reimbursing third-party service providers at levels dramatically below what it costs to care for people in assisted-living facilities, people with disabilities, and people with mental illness and addiction. Gianforte’s initial budget proposal filled some but not all of the estimated gap, triggering a session-long debate over how much additional money to provide for those services. The portion of the increase Fitzpatrick advocates for vetoing was added by a 49-1 vote on the Senate floor April 24, with him among the “yes” votes.

In his letter, Fitzpatrick suggests that the benchmark figures in the study may be flawed. “By increasing the provider rate reimbursement to 100%, the State of Montana could actually be overpaying for services,” he writes.

Democrats and industry advocates have argued the rate study’s benchmark actually underestimates the current cost of providing services given the pace of inflation in recent years.

“It’s unfortunate Senator Steve Fitzpatrick isn’t more informed about provider rate increases proposed in the Governor’s Medicaid rate study,” Mary Windecker, executive director of the Behavioral Health Alliance of Montana, said in a statement to Montana Free Press Thursday. “The proposed rate benchmarks were based on 2019 costs with a small inflationary amount added. As with all businesses, costs have increased for Medicaid providers at an unusually high inflation rate just as they have for other businesses.”

The governor’s office didn’t commit to signing or vetoing the $15 million increase for providers in an emailed response to questions Thursday.

“When the governor receives House Bill 2, he will also consider it in the same way he considered House Bill 5, with the mission to protect taxpayer dollars, cut pork, and bring greater fiscal discipline to the budget,” wrote Gianforte Press Secretary Kaitlin Price.

Arren Kimbel-Sannit and Mara Silvers contributed reporting.

Erich Dietrich is deputy editor of the Montana Free Press, a Helena-based nonprofit newsroom, and can be reached at edietrich@montanafreepress.org. To read the story as originally published, click here.